Read on the Trading Floor - 28 Feb 2024
Today’s focus… MOMO trades in DeFI vs micro trades in TradFI
Macro Themes At Play
Theme 1 - Momentum trades in DeFi
Theme 2 - Micro trades in TradFi
Theme 3 - China bubbling under the surface?
Further reading and listening of note
Theme 1 - Momentum trades in DeFi
60k Bitcoin fast approaching as we hit levels last seen in Nov 2021. That’s 16% on the week and nearly 40% in Feb. Ahead of the next halving, $67.5k is a clear target on the charts. The theme is clear... Fifty days or so until the halving (approx. April 17th), institutional adoption (record breaking trade volumes on iShares), emerging mkt dollarization and attraction to stablecoins in the fight against hyperinflation and of course cross border flows....
CoinDesk - Binance Nigeria Funelled $26B in Untraceable Funds in 2023, Central Bank Chief Says
Ecoinometrics - Did the Bitcoin ETFs change the correlation patterns?
Coinstack - BlackRock ETF Daily Trading Volume Surpasses $1B 🚀
The Pomp Letter - The Financial World Is Starting To Understand Bitcoin
TFTC - Bitcoin in Argentina
The Wolf Den - Arguments
Bloomberg - Bitcoin Surges to $60,000 With Enthusiasts Eyeing Record Highs
Theme 2 - Micro trades in TradFi
It's been a terrible slow start to the year (Reuters - JPMorgan CFO expects trading revenue to decline in first quarter) and the past 24hours is reflective of some micro trades in play but overall volumes remain depressed. The USD "rally" started in APAC when the RBNZ disappointed (trimmed their peak forecast rate from 5.7% to 5.6%) and saw NZD drop over 1% to 0.6100. It has continued into the London session with Corp T+2 day running through the pipes. It already looks bored and tired after the Q4 second estimate was revised slightly lower to 3.2% from the advance estimate of 3.3%. (Calculated Risk - Q4 GDP Growth Revised Down to 3.2% Annual Rate)
Theme 3 - China bubbling under the surface?
We've had a wave of interventions from authorities, national team purchases, RRR cuts, Quant funds investigated, short selling rule changes and with some key domestic political events ahead, could we finally see something more meaningful on the fiscal side to give the recent squeeze in Chinese assets staying power...
Steno Research - Something for your Espresso: Is China rebounding or not?
Bloomberg - China Tells Quants to Phase Out Strategy Blamed for Turmoil
Axios - Biden executive order aims to stop U.S. data sales to China, Russia
Gordian Knot - China: Careful, Indices Reversed in Heavy Volume
SCMP - China’s central government should take leading role in kick-starting consumption
SCMP - China’s ‘two sessions’ 2024: have new pressures already fractured last year’s economic model?
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Top Pieces
Discovered on Harkster.com
Brent Donnelly am/FX - Canada is a lot like NZ
FT - Apple parks its electric car project in sign of EV industry’s struggles
The Next Economy - February Inflation
Steno Research - Money Watch: Trillions of USDs are waiting to be unleashed
FT - Saudi football clubs to return to transfer market, says top executive
Econostream - Exclusive: ECB’s Šimkus: ‘Don’t See Anything Wrong’ in Starting to Discuss Rate Cut Preconditions in March
James Barrineau's Two Minute Drill - Bonds Don't Belong Here...
The New York Times - How Apple Used its Car Project to Drive Wider Innovation
Bloomberg - Easiest Trade in Bonds Falters as Fed Rate-Cut Bets Move Back
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